South Korean Exchange Triggers KOSPI Index Circuit Breaker, Pauses Algorithmic Trading for 5 Minutes

BlockBeats News, July 20th. The South Korean exchange (KRX) triggered the Sidecar mechanism due to volatility in the KOSPI index, pausing programmatic trading for about 5 minutes.

The Sidecar mechanism is mainly used to address sharp fluctuations in a short period and only restricts programmatic trading, while manual trading can still proceed normally. Unlike the Circuit Breaker, the Sidecar mechanism does not halt the entire market but is more like a "speed bump" during market turbulence.

In contrast, the Circuit Breaker is usually used in extreme market conditions, where it halts all market trading to prevent panic-induced swings from escalating further.